Will Britain reduce its anti-money laundering checks following Brexit? Not quite.

15 Mar 2024, 40 mins ago

HM Treasury has recently proposed ways to improve the effectiveness of Anti-Money Laundering (“AML”) checks. Published in its consultation paper, which will remain open for public consultation until 9 June 2024, the Treasury made clear that while it has no plans to change monetary thresholds for triggering due diligence, it does want to make AML rules more proportionate and effective for companies and their customers, and to clarify when checks are needed.

What does the consultation paper entail?

The consultation identifies four areas for improving the effectiveness of the Money Laundering Regulations (“MLRs”), which are:

  1. Making customer due diligence (“CDD”) more proportionate and effective;
  2. Strengthening system coordination;
  3. Providing clarity on the scope of the MLRs; and
  4. Reforming registration requirements for the Trust Registration Service.

In parallel to the consultation, the Government is running a survey on the cost of compliance with the MLRs. The Government expects the survey to help with the assessment of the impact of any proposed changes to the legislation. 

Whom do the rules apply to?

The rules apply to as many as 100,000 businesses, such as banks, accountants, lawyers, estate agents and casinos which undertake “know your customer”(“KYC”) checks.

Why is this happening?

Previously, banks have been fined on numerous occasions for having inadequate systems in place to enforce AML controls. Further, businesses complain that they have been unfairly refused banking and account services due to perceived AML concerns. Indeed, this is a topical issue, which Gherson has addressed in more detail in the following articles: 

Given these practical concerns on both the part of the regulated firms and their clients/customers, HM Treasury is looking to improve the clarity and effectiveness of the current AML rules, in order to reduce instances of such cases.

Are there any other reasons for the HM Treasury taking this step?

Following Brexit, the Treasury wishes to reform the AML rules to suit the needs of UK businesses. In particular, when it comes to the current monetary thresholds which trigger AML checks, the Treasury would like to change the currency to sterling, as the denominations are still listed in euros.

In addition, the Treasury wants to ensure that AML rules are suitable for the adequate regulation of new and emerging financial activities, such as cryptoassets.  

Gherson is separately able to offer advice in relation to the regulation of cryptoassets

Finally, the Treasury is looking at ways to improve how AML-related data can be shared among agencies, such as the Financial Conduct Authority (“FCA”), to better tackle financial crime.  


Gherson’s regulatory, white-collar and investigations team are highly experienced in providing assistance, advice and guidance on how you can successfully navigate and adhere to legal requirements regarding corporate compliance. This includes providing a comprehensive and unparalleled range of regulatory and compliance services to prospective customers.

Specifically, Gherson’s white-collar crime and regulatory team are able to provide advice and assistance with AML and sanctions compliance, including in situations involving cryptoassets

Finally, the team has recently started a series of blogs on the regulation of crypto, with the aim of advising those who work in the compliance of this sector. In addition, for those who would like advice on relevant issues, including those who have had issues with the FCA registration process, our specialist regulatory and compliance team can guide individuals and companies through the process.

Please do not hesitate to contact us for further advice, send us an e-mail, or, alternatively, follow us on XFacebook, or LinkedIn to stay up-to-date.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

©Gherson 2024